Situation

In early 2017 Epic launched their Pork Skins with a custom pack size optimized for Amazon with an entry level price point and rapid customer consumption. By the end of 2017 these products were shut off on Amazon for being unprofitable.

Solution

By measuring the $ margin and Accrual Contribution with respect to the desired retail price point against benchmarks for internal operating costs, Epic was able to maximize profitability for themselves and Amazon allowing for the items to be reinstated.

Outcome

This practice resolved profitability constraints for Amazon that previously constricted demand. Correcting margin for Amazon allowed Epic to realize an increase in orders on these products of 36% in Q1 2018 when compared to all orders in 2017. This process reinforced Epic Provisions understanding of profitability and its implications for growth on Amazon. They continue to apply this process to identify at-risk items in their catalog to resolve declining demand derived from loss buy box and lost sourcing.